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How to leverage Expedia for direct hotel revenue

Written by Hospitality & Travel Tuesday, 14 September 2010 08:58

Some travel industry experts portray Expedia as a monopoly that is taking online revenue away from hotels. No matter how you feel about this characterization, there is no denying that Expedia is a powerhouse. The key is to using Expedia is to harness its power to benefit your hotel’s online revenue, especially as Expedia is morphing from a traditional OTA into a travel search engine.

Expedia placement comes at a cost. There is a commission based on several factors, such as location, brand, business mode, etc. However, you must view this expense as a cost of doing business. Just as we spend on Google to optimize and buy pay per click ads for hotels, Expedia placement should also be part of an overall online marketing campaign. Expedia can not only influence your top line, but also boost bookings on your proprietary websites and your Google campaign conversions.

Evision Worldwide’s experience with clients in top-tier markets reveals to us a notable, positive relationship between a hotel’s ranking on Expedia.com and the subsequent performance of paid search marketing campaigns on Google. With all of our hotel clients, we underscore the necessity of incorporating Expedia presence as part of their overall comprehensive online marketing strategy.

Case Study

A four-star hotel client in a competitive, top-tier market obtained #1 placement on Expedia. Almost immediately, a significant spike in conversions and traffic was observed. More important, their Google AdWords results were also affected by the placement.

The hotel saw the following changes during the immediate 3-month period following the #1 Expedia placement, as compared with the same 3-month period the previous year:

22% increase in AdWords impressions for brand name keywords
7% increase in AdWords click-through rate (CTR)
16% increase in overall online conversion rate
Though changes were made to the PPC campaign strategy during the year, the large increase immediately after the Expedia listing, coupled with consistent gains following the listing, indicate that a large portion of the gains can be attributed to the Expedia listing. Not only were the effects immediate, but the placement also produced longer-term results that were similar to results obtained by other domestic and international clients in our portfolio.

The Google Effect

Your hotel’s presence on Expedia doesn’t end there. It also gets you exposure on Google. This increased visibility is especially valuable if your hotel is not yet ranking in Google for some of the highly competitive city-based searches (ex: hotels in Sydney, hotels in San Francisco, hotels in London).

How does your Expedia listing expose you to millions of additional online searches? A majority of the savvy searchers on Expedia will copy and paste your hotel’s name right from Expedia into Google to check out your website, and potentially will book directly with you. Of course, you will need to show up in Google for your own name, have a decent website with the right messaging, and an effective booking engine. Independent hotels who have addressed these factors usually see the best ROI from an Expedia placement, as it effectively helps them drive direct traffic and reservations on their proprietary websites.

Strategies for Leveraging Expedia Placement

Here are some strategies hotels can employ to make the most of their presence on Expedia:

Go for higher Expedia rankings. Remember that your hotel brand and revenue will definitely get a boost from healthy exposure on Expedia.com. View your commission payment as the cost of marketing on the world’s biggest travel search engine.
Have a strong search marketing program. Make sure you dominate your brand-related searches on Google. Expedia will drive higher brand-related traffic your way. It’s your duty to dominate the search engine results page with SEO and PPC to capture and convert this traffic into revenue.
Convert visitors on your site. Online travelers who find you on both Google and Expedia have a choice to make about where they book. Make sure you offer an above-average website experience and a robust booking engine. You also need to offer rate parity and as many extras and conveniences as you can to entice guests to book directly with you.
Use Expedia PPC. If for any reason (brand-related pressure, rate restrictions, etc), your hotel is not able to get top-level placement on Expedia’s location search, you now have the opportunity to bid for top placement in Expedia’s paid search area. Expedia’s own pay per click program can be seen in full force if you search for rooms in any major US metropolitan area. These ads can really help you get you hotel name out there. Expedia PPC is especially relevant for independent hotels, hotels that have recently renovated, and hotels that have changed their brand affiliation. But getting your brand name out there is always a priority.
In conclusion, we must all start to acknowledge the massive online presence that Expedia has built for itself over the years. It’s easy to get caught up in negative propaganda on how some hotels have been robbed of their online share. Instead of thinking of Expedia as a competitor, hotels should think of ways to leverage Expedia’s massive spending and advanced search marketing efforts. You need to explore every option to boost your online revenue. The fact is that, when used to your advantage, Expedia.com is one of the best ways to start driving direct revenue and bookings to your hotel.